Why Would I Need a Bill of Sale to Sell Property?

A bill of sale document is used when property ownership is transferred. The written document states the specifics of the item and details regarding the sale. A bill of sale is used to reduce the risk of fraud associated with a private sale. It also ensures the sale is conducted fairly and legally. The buyer and seller are required to sign the bill of sale acknowledging agreement to the terms and conditions. In many states, the bill of sale is mandatory for vehicle transactions.


  • When selling property, it is best to have a bill of sale that spells out the transaction. This protects both the buyer and the seller, showing that the parties have come to a mutual agreement.

The Basics

The bill of sale confirms transfer of title to or ownership of the property, while at the same time serving as evidence of a contract. Because a bill of sale is often required to register a vehicle or boat, your state may have specific regulations. For example, Louisiana, Maryland, Nebraska, New Hampshire, and West Virginia require a notarized bill of sale for registration. The bill of sale also creates a record of the personal property's value for sales tax and insurance purposes.

Types of Personal Property

A bill of sale is generally recommended when selling personal property of value. Although automobile sales between private parties are the most common pieces of property involved in a bill of sale, it can be used to document the sale of many other personal property items.

You may want to use a bill of sale when buying or selling a computer, TV, stereo, furniture, boat, aircraft, trailer or motor home. If you want to sell real estate, you will need to use a land sale contract or real estate contract.

Protection for Both Parties

Whether it is required under state law or not, a completed bill of sale can provide added security for both parties. As the seller, the bill of sale proves you are no longer responsible for the property. For example, If the new owner gets in an accident or incurs a traffic violation in a car you sell him, you are not liable if ownership is legally clear.

For buyers, the bill of sale outlines the details of the transaction and includes any guarantees, warranties or claims made by the seller. Also, by completing the bill of sale, the seller confirms she is the legal owner authorized to sell the property.

Completing a Bill of Sale

If your state requires a bill of sale for registering an automobile, you can obtain a bill of sale form from the local department of motor vehicles. There are also state-specific templates available in office supply or stationery stores. A bill of sale requires the full legal names of the buyer and seller, a contact number and physical address for both parties and a detailed description of the property.

If you are buying or selling a vehicle, you will need the Vehicle Identification Number and the odometer reading at the time of sale. For other personal property, include the manufacturer's serial number. Indicate the exact sale price. Include the date, time and location of the sale.